HEARING - U.S. Senate Special Committee on Aging

141
492 :486 New Developments
10,939
inronii, ri oilh ihe uiii.. .r ... i,-il i-iinitolny
of the plainit' nme-diral rpwrle Sir Fi inding of
Fact 6. For anllhcr, ihi denid;mlC i rgument
that Irartial coecrage of a given service under
Part B of Medicare somehow foriteiio full coverage
of that sevice under Plart A of Medicare
appears to conflict *vith the regulator- require.
ment that, in determining whether skilled nursing
or rehabilitation services can "as a practical
matter" be provided only by an SNF, "the
availability of Medicare payment for those services
may not be a factor." 42 C.F.R.
§ 409.35(a).
In addition, the Secretary contends that any
conflictbetween the plaintiffs' experts and the
intermediaries with respect to the need of a
given category of patient for daily skilled physical
therapy is nothing more than a "bona fide
professional difference of opinion." Defendant's
Post-Trial Memorandum at 16 & n-5. However,
the only evidence offered by the defendant in
support of this proposition, see Tr. 75-76, is
limited to the question of whether coverage
ought to be provided for range-of-motion exercises.
The defendant has offered no evidence of
any "bona fide professional difference of opinion'
concerning non-weight-bearing therapy,
maintenance therapy, therapy for amputees
who are awaiting prostheses or therapy for
patients who can ambulate 50 feet with supervi.
sion. Furtherriore, even assuming for the argument
that some professional difference of
opinion exists with respect to range-of-motion
ex rcises, the regulations expressly provide coverage
for such exercises whenever they are "part
of the active treatment of a specific disease
state which has resulted in a loss of, or retriction
of, mobility" 42 C.F.KR § 409.33(cX4).
Finally, the defendant maintains that the
in term iaries' denials of coverage cannot be
characterized as arbitrary because employees of
an intermediary sometimes are available to discuss
individual coverage decisions with employees
of an SNF. See Finding of Fact 16;
Defendant's Post-Trial Memorandum at 16-17
& n.5. However, in the absence of any evidence
in the record that these discussions have caused
intermediaries to alter their coverage decisions
in more than isolated instsnces, see id, the couat
cannot find that these occasional informal cornmunications
between SNFs and their
intermediaries afford the plaintiffs the individuadized
determinations of their eligibility for
skilled physical therapy to which they are entitled
under the applicable regulations.
In order to determine whether the
intermediaries' improper denial practices violate
the Due Process Clause of the Fifth Amendment,
the court must apply the balancing test
enunciated by the Supreme Court in Afath ewas v
Eldridge, snpra. 424 U.S. at 335. That test
Medicare and Medicaid Guide
requires tile court to i-omiditcr tre fiii ri lactars:
[flirst. the prina e in irest tha will he
affectil hi th- ifficia art irsn wrond, the risk
of an erroneuus reprivstiorn rf suth interest
through proccilures oscr. and the prohable
value, if any, of additional or substitute pro
cedural safeguards; and finally, the Government's
interest, including the function
involved and the fiscal and administrative
burdens that the additional or substitute procedural
requirement would entail. See Kraeme-,
supra, 737 F.2d at 221 (applying
Mafthews v. Etdridge balancing test in due
process challenge to Secretary's "presumption
of non-liability' procedure).
The private interest at stake in this action is
highly significant. A denial of a Medicare claim
for physical therapy benefits has important
physiological, psychological, and financial implications
for the plaintiffs. See Findings of Fact
17-20. As the Court of Appeals held in Kraemer,
which also involved the denial of Medicare benefits
to SNF patients, the irivate interest in such
cases is particularly great because the costs of
SNF care "can financially cripple all but the
very wealthy" in a matter of weeks and "diminish!
the probability that a patient could choose
to continue receiving medical care." 737 F2d at
Z22.
The risk that the plaintiffs will erroneously be
deprived of their Medicare benefits is great
indeed, as is demonstrated by the high perrentage
of decisions denying physical therapy coverage
that are reversed on appeal. See Findings of
Fact 27-28. In addition, many other patients
with potentially meritorious claims are physically
or mentally incapable of pursuing an
administrative appeal. See Finding of Fact 29.
See also David v. Heckler, supra, 591 F.Supp. at
1044 (holding that even a 33 percent reversal
rate established a "substantial" risk that plain.
tiffs would be erroneously deprived of Medicare
Part B benefits and that "numerous erroneous
determinations [denying benefits] are not
appealed"). It is clear that additional safeguards
win significantly reduce the risk that
members of the plaintiff class will continue to be
erroneously deprived of their benefits.
Finally, alternative procedural safeguards
designed to ensure that Medicare coverage
determinations are made on the basis, of the
individual patients medical condition and therapeutic
requirements rather than on the basis
of arbitrary and inflexible presumptions, see
Section IIC, infrta, will entail no greater "fiscal
and administrative burdens" for the government
than are contemplated by the applicable
law and regulations. Furthermore, these safeguards,
by ensuring that members of the plain.
tiff class receive the medically necessary
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